JP Morgan Needs Two New Private Jets

By Reuters Staff

March 23, 2009

Jamie Dimon has clearly decided he has no intention of ever becoming Treasury secretary:

Embattled bank JPMorgan Chase, the recipient of $25 billion in TARP funds, is going ahead with a $138 million plan to buy two new luxury corporate jets and build "the premiere corporate aircraft hangar on the eastern seaboard" to house them, ABC News has learned.

Apparently JP Morgan has promised to repay the $25 billion before it buys the two brand-new G-650s. So much for the importance of giving TARP funds to healthy banks. And what about the $30 billion in non-recourse loan guarantees that JP Morgan got from the Fed when it bought Bear Stearns?

Let’s not forget the shareholders, who bear the brunt of this kind of corporate spending with little say in it.

There’s simply no conceivable way in which these jets represent a necessary and legitimate business expense. They would have been an extremely lavish and barely-justifiable perk in good times; in bad times, they look like nothing so much as a calculated affront to JP Morgan’s customers. $138 million would fully fund $500 overdraft facilities for a quarter of a million Americans, with $13 million left over for waiving bank fees. Anecdotally, a very large number of WaMu customers are angry at suddenly banking with Chase. I’m quite sure that this news is not going to make them any happier.